IT Salaries Fall In 2001 - Janco
Associates
By Michael Bartlett, Newsbytes
PARK CITY, UTAH, U.S.A.
11 Jun 2001, 5:50 PM CST |
After years of unrestrained growth, compensation for
information technology (IT) workers declined in the first half of
this year, according to the latest installment of a salary study
released today.
The study by Janco Associates, an international consulting
organization based in Park City, Utah, found the average yearly
compensation package - including bonuses, stock options and fringe
benefits - for IT personnel at medium-sized companies shrank from
$113,224 to $110,578.
At large companies, total compensation packages dipped slightly
from $108,963 to $108,275, the study said.
M. Victor Janulaitis, CEO of Janco Associates, said the company
has tracked IT salaries every six months since 1983, and the
period of January to May 2001 marks the first time since 1985 that
there has been a decrease in the salary paid to top performers. He
called the findings "startling."
"The most important thing to note is we finally have reached a
trend," said Janulaitis. "For the first time in a long time, IT
salaries did not continue to escalate at an ever-increasing rate.
In the 1990 recession, they slowed but did not decline."
Part of the decline can be blamed on a significant drop in the
value of most companies' stock options, Janulaitis said. However,
there are more factors at work and some might cause more problems
in the future.
"Last year at this time, an IT professional could find a new
job and get a 10 percent to 20 percent increase, mostly through
performance bonuses or stock. Now, dot-com companies are closing,
meaning more people are looking for fewer jobs," he said. "The
dot-com phenomenon has gone through to IT, and has had a real
impact."
Janulaitis predicted that the economy will remain slow for the
near future, causing companies to continue tightening their belts
for the next two to three quarters. He said the fallout from the
energy crisis that has plagued California and threatens other
states has not finished.
"For the first time, we are seeing massive layoffs as companies
shift IT functions out of house," he said.
Another factor driving salaries down is the loss of jobs
formerly filled by holders of "H-1B" visas in the United States.
According to Janulaitis, foreign nationals could apply for these
visas if a company could show that no U.S. national could do the
job and it was a highly paid position. He said this created a
"subset of high-paying jobs" that no longer are cost-effective for
companies to continue.
H-1B visas are six-year temporary worker permits that allow
foreign nationals to secure employment in the U.S. in eligible
firms that pay the U.S. government, in addition to the employees.
The government has issued 117,000 H-1B visas this year, continuing
to ratchet up the number made available each year after Congress
passed laws allowing the near-doubling in the wake of the IT
industry's clamoring for foreign help.
The IT professionals most likely to hold onto their jobs are
those who increase revenue or reduce risk, said Janulaitis. He
said people who know how to manage e-commerce and process orders
online fit the first category, and security experts fit the
latter.
"The infrastructure positions, the ones companies regard as
overhead, are the positions in the most danger," he said.
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